FINWIRES · TerminalLIVE
FINWIRES

Danone Confirms 2026 Outlook While Formula Recall, Middle East War Weigh on Quarterly Sales

By

-- Danone (BN.PA) on Wednesday upheld its 2026 guidance even as the recall of its infant milk formula in Europe and the conflict in the Middle East dragged reported sales down 2% year over year in the first quarter.

Sales of the French food products company declined to 6.71 billion euros in the three months ended March 31, from 6.84 billion euros a year earlier, as the positive impact of scope and hyperinflation was offset by foreign exchange headwinds. Analysts polled by FactSet were expecting 6.69 billion euros in sales.

On a like-for-like basis, however, sales gained 2.7% thanks to a 1.5% rise in volume/mix and a 1.2% uptick in price. Amid the challenging market dynamics, Danone said the performance in Europe, Middle East and Africa remained "resilient" with a 0.6% increase in LFL sales.

Growth in the Americas improved 3.4% as the US began to regain momentum amid continued strong performance in Latin America. In Asia Pacific, LFL sales climbed 6%, driven by the demand for specialized nutrition in China and essential dairy and plant-based, or EDP, products in Japan. By category, EDP sales rose 3.4%, while those of specialized nutrition and waters increased 1.9% and 2.3%, respectively.

"Our winning platforms continued to perform strongly, notably in dairy with high protein, skyr and kefir, in Waters with evian and Mizone, as well as in medical nutrition around the globe," Chief Executive Officer Antoine de Saint-Affrique said. "We are confident in our science based, and consumer and patient centric approach and confirm our full year guidance."

In line with mid-term ambition, the company reiterated its 2026 outlook for 3% to 5% annual growth in LFL sales, with recurring operating income expanding faster than sales.

"Organic sales growth of 2.7% was in line with consensus, albeit below full-year guidance of 3-5%. Specialised nutrition came in 75 [basis points] below consensus, impacted by the IMF recall in Europe, though EMEA overall came in ahead of expectations thanks to good performance from EDP," RBC Capital Markets said. "We are confident that Danone can accelerate category growth and will deliver consistently in line with 3-5% organic sales growth guidance."

Danone shares gained 3% in Paris on Wednesday midday.

Related Articles

Mining & Metals

CN Rail Q1 Adjusted Diluted EPS of C$1.80, a Decrease of 3%; Or C$1.83 on an Adjusted Basis at Constant Currency, a Decrease of 1%

$CNR.TO
Research

William Blair Downgrades Tenable to Market Perform From Outperform

Tenable (TENB) has an average rating of overweight and mean price target of $29.26, according to analysts polled by FactSet.(covers equity, commodity and economic research from major banks and research firms in North America, Asia and Europe. Research providers may contact us here: https://www..com/contact-us)

$TENB
International

US Dollar Rises Early Wednesday Ahead of Busy Data Schedule, FOMC Meeting

The US dollar rose against its major trading partners early Wednesday, except for a decline versus the Canadian dollar, ahead of a series of economic releases in the morning and the Federal Open Market Committee policy statement in the afternoon.Durable goods orders, housing starts, and advance trade data, all for March, are due to be released at 8:30 am ET.Weekly petroleum stocks data are due to be released at 10:30 am ET, and the Atlanta Federal Reserve is expected to update its GDP nowcast estimate around midday.The FOMC is expected to hold its target rate steady in its post-meeting statement at 2:00 pm ET, followed by Fed Chairman Jerome Powell's press conference at 2:30 pm ET. The CME FedWatch shows a 100% chance of no rate change being priced into the markets.Earlier Wednesday, the Mortgage Bankers Association reported that mortgage applications declined in the week ending April 24 after a large increase in the previous week, as mortgage rates rose slightly.A quick summary of foreign exchange activity heading into Wednesday:EUR/USD fell to 1.1705 from 1.1710 at the Tuesday US close but was above a level of 1.1694 at the same time Thursday morning. Eurozone consumer confidence and business sentiment both declined in April, while the Eurozone money supply expanded in March, according to data released earlier Wednesday. The next European Central Bank meeting is scheduled for Thursday, when no change in the target rate is expected.GBP/USD fell to 1.3510 from 1.3516 at the Tuesday US close but was above a level of 1.3484 at the same time Tuesday morning. There are no UK data on Wednesday's schedule. The next Bank of England meeting is scheduled for Thursday, when no change in the target rate is expected.USD/JPY rose to 159.7876 from 159.6661 at the Tuesday US close and 159.6369 at the same time Tuesday morning. There were no Japanese data released overnight. The next Bank of Japan meeting is scheduled for June 15-16.USD/CAD fell to 1.3681 from 1.3687 at the Tuesday US close but was above a level of 1.3662 at the same time Tuesday morning. The Bank of Canada is expected to maintain its target rate in its announcement at 9:45 am ET. There are no Canadian data on Wednesday's schedule.

$EUR/USD$GBP/USD$USD/CAD$USD/JPY